In what appears to be the biggest listing yet for this year, Alibaba could make about HK$100bn (£10bn) as it lists in Hong Kong.
The Chinese retail company announced that it is listing a total of 500,000,000 ordinary shares as its Global Offering. This comprises an international offering and a Hong Kong public offering.
The 500 million shares are divided into 12,500,000 public retail offerings while 487,500,000 is for the global subscription.
The shares have been priced at 176 Hong Kong Dollar per Share (HK$ 176 per share). The offer price was set by considering the closing price of the American depository shares (ADSs) on the last trading day before pricing which was November 19.
Alibaba’s decision to list in Hong Kong comes amid the unrest that has defined the city for some time. According to the retail company, it planned to list in June but could not because of unrest that sprung up between the police and some protesters then.
However, the head of research at London Capital Group, Jasper Lawler, expressed that the listing in Hong Kong was strategic for the company because the “the company has huge cash stockpiles so doesn’t need to raise the funds in Hong Kong.”
“The advantage for Alibaba is twofold: it can diversify its shareholder base during the US-China trade war and it can command a high price, in part because investors in Hong Kong are clamouring for something positive amid the protests.”Jasper Lawler, Head of Research at London Capital Group
Alibaba is listing its shares under the stock code 9988. These numbers are believed to be significant in Chinese culture as they stand for eternal prosperity.
Part of Alibaba’s vision is to be a company that exists and thrives with its staffs and members for 102 years. The big listing is expected to help the company with its goal of making gross proceedings of HK$ 88,000 million in profits before underwriting fees and other offering expenses.
From the proceeds, Alibaba plans to implement its strategies to drive user growth and engagement, empower businesses to facilitate digital transformation, and continue to innovate and invest for the long term.
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